§6249 — Title 42 The Public Health and Welfare | U.S. Code

Summary

The Secretary may make contracts to store petroleum in unused Strategic Petroleum Reserve sites or in other storage facilities, and the oil can be U.S.-owned or privately owned. Petroleum held under these contracts counts as part of the Reserve while the contract lasts and is managed under the Reserve’s rules. The Secretary may use these contracts only if they decide the contracts give benefits comparable to buying the same oil or storage and if budget limits stop buying under part B. The Secretary must tell both Houses of Congress where the storage is, what type and ownership it involves, how much and what type of oil, and an estimate of the benefits. Contracts cannot stop a drawdown or sale by the President or Secretary, must say payments depend on available appropriations, can be free or fee-based, can run as long as needed, may allow binding arbitration, and may use SPR Petroleum Account funds even before the oil arrives.

Title 42, §6249

The Public Health and Welfare — Source: USLM XML via OLRC

(a)Subject to the other provisions of this part, the Secretary may contract—

(1)for storage, in otherwise unused Strategic Petroleum Reserve facilities, of petroleum product not owned by the United States; and

(2)for storage, in storage facilities other than those of the Reserve, of petroleum product either owned or not owned by the United States.

(b)(1)Petroleum product stored pursuant to such a contract shall, until the expiration, termination, or other conclusion of the contract, be a part of the Reserve and subject to the Secretary’s authority under part B.

(2)The Secretary may enter into a contract for storage of petroleum product under subsection (a) only if—

(A)the Secretary determines (i) that entering into one or more contracts under such subsection would achieve benefits comparable to the acquisition of an equivalent amount of petroleum product, or an equivalent volume of storage capacity, for the Reserve under part B, and (ii) that, because of budgetary constraints, the acquisition of an equivalent amount of petroleum product or volume of storage space for the Reserve cannot be accomplished under part B; and

(B)the Secretary notifies each House of the Congress of the determination and identifies in the notification the location, type, and ownership of storage and related facilities proposed to be included, or the volume, type, and ownership of petroleum products proposed to be stored, in the Reserve, and an estimate of the proposed benefits.

(3)A contract entered into under subsection (a) shall not limit the discretion of the President or the Secretary to conduct a drawdown and sale of petroleum products from the Reserve.

(4)A contract entered into under subsection (a) shall include a provision that the obligation of the United States to make payments under the contract in any fiscal year is subject to the availability of appropriations.

(c)The Secretary may store petroleum product pursuant to a contract entered into under subsection (a)(1) with or without charge or may pay a fee for its storage.

(d)Contracts entered into under subsection (a) may be of such duration as the Secretary considers necessary or appropriate.

(e)The Secretary may agree to binding arbitration of disputes under any contract entered into under subsection (a).

(f)The Secretary may utilize such funds as are available in the SPR Petroleum Account to carry out the activities described in subsection (a), and may obligate and expend such funds to carry out such activities, in advance of the receipt of petroleum products.

Notes & Related Subsidiaries

Editorial Notes

Prior Provisions

A prior section 171 of Pub. L. 94–163 was renumbered section 191 and was classified to section 6251 of this title, prior to repeal by Pub. L. 109–58.

Amendments

2000—Subsec. (b)(2)(B). Pub. L. 106–469, § 103(20)(A), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “the Secretary notifies each House of the Congress of such determination and includes in such notification the same information required under section 6234(e) of this title with regard to storage and related facilities proposed to be included, or petroleum product proposed to be stored, in the Reserve.” Subsec. (b)(3). Pub. L. 106–469, § 103(20)(B), substituted “sale of petroleum products from” for “distribution of”. 1992—Subsec. (f). Pub. L. 102–486 added subsec. (f).

§6249 Contracting for petroleum product and facilities